§ Mr. REDDY (in the absence of Mr. Cullinan)
asked the Secretary to the Treasury to explain the basis of calculation on which pension officers find that three times the rent of a farm is a fair return of the profit accruing from the same?
§ Mr. HOBHOUSE
As the result of inquiries made by the Board of Inland Revenue last October the conclusion was arrived at that, in the absence of special circumstances, three times the rent was a fair estimate of the average profit derived from 17 a small farm in Ireland, and the profits accruing from such farms have in a large number of cases been estimated on this basis by pension officers for the purpose of their reports to pension committees. Where, however, such a method of calculation was deemed to be unsatisfactory the pension officer has been required to furnish a report giving a detailed statement giving a description of the land, and showing other particulars as to acreage and stock, so as to enable an estimate of income to be formed, if necessary, with greater precision. Instructions have now been given that such reports are to be submitted in all cases.
§ Mr. SNOWDEN
Is it not the fact that for the purposes of Income Tax the income of a farm tenant is taken at one-third of the rent; and, if so, why for the purpose of old age pensions should the income be taken at three times the rent?
§ Mr. HOBHOUSE
I am not sure that the facts are as stated by the hon. Member, and if they are I am not sure a large number of people do not get off paying Income Tax.
§ Mr. KILBRIDE
Have any of these pension officers ever had a small farm, or do the Treasury officials know of anyone who has made three times the rent as profit?